In the Infinite Banking System, most people will purchase a new car or pay off an existing car loan. This example considers the purchase of a $40,000 car using four methods of payments—three traditional methods and the Infinite Banking Concept.
The main source for comparison will be the total cost.
THE ASSUMPTIONS FOR THE ILLUSTRATION
- 44-year time period with a new car every 4 years.
- Traditional bank financial and IBC financing will be at 8%.
- 5% rate of return.
- Residual value on leases will be 35% of actual value.
- Residual value will allow the same amount financed ($40,000) each time with traditional bank financial and IBC.
- Your annual payment, bank financing, and IBC System equals $12,077.